Abigail Mbalo-Mokoena is a South African Chef and restaurateur who competed and reached the top six on the 2014 series of MasterChef South Africa. On 1 January 2015 she opened her first restaurant called 4Roomed that specialises in modern interpretations of traditional African dishes. Abigail has also entered into contracts with small businesses in the Khayelitsha to supply their employees with lunch, as these companies do not have canteen facilities. Abigail likes to prepare food that showcases the ingredients used, therefore she only uses organic fresh produce. The food that she prepares is simple, sophisticated and delicious. The restaurant has a 31 December year-end. The following information relates to the financial period ending 31 December 2022: 1.

Sales for the period were R300 000. Included in that amount is R24 000 from Ekhasi Company (Pty) Ltd in respect of meals for its staff for the 2023 year (January to December). 2. The following information relates to cost of sales for the period: R Opening stock 83 500 Closing stock 178 000 Purchases 180 600 Purchase returns 15 100 Railage 5 000.Interest of R8 500 on investments was earned during the year. 4 4. 4Roomed is based in a shopping centre. The rent is R4 000 per a month. 4roomed has occupied the property for the entire year. 5. 4Roomed obtained a loan from ZAR Bank Ltd to purchase a new oven.

The following information relates to the new oven:

Date of purchase: 1 April 2022 Cost: R68 000 Installation fees: R2 000 Depreciation method: Straight-line method Depreciation rate: 10% per annum, apportioned for part of a year Loan amount: Cost and installation fees Loan term: 10 years Interest rate: 12% per annum Interest payment: Interest is paid one month in arrears 6. Insurance was paid for the full 2022 year as well as one month in advance for 2013. The total amount of insurance paid as per the bank statements is R19 500. 7. One of 4Roomed contract customers has subsequently gone into liquidation. The total amount of their account outstanding is R3 690. Elena also decided to raise a provision for doubtful debts to the value of R1 300. 8. The water and electricity expense for the period 1 January 2022 to 30 November 2022 was R12 600. 4Roomed has not received an invoice from the municipality in respect of December 2022 yet. Abigail estimated that the average monthly consumption of water and electricity for 4Roomed is R1 200. 9. Administration expenses for the year amounted to R9 800. 10. The taxation expense is calculated as 28% of the taxable income of a company. 4Roomed had a taxable income of R254 360 for the year. (Note: This may not necessarily correspond to the profit before tax you have calculated.)

Prepare the income statement of4Roomed for the year ended 31 December 2022.

Remember to use the correct structure for an income statement.

Show all workings. (30) 2.2 Calculate the carrying amount of the new oven as at 31 December 2022.